Avemco lowers rates on LSAs

Avemco has insured LSAs since they were first introduced four years ago. At the time all LSAs were rated the same.

“In the beginning, the results weren’t particularly good,” said Jim Lauerman. “But we got into the business, we learned the business – we took our hits – and made some adjustments.”

Lauerman noted that many of those early losses were from GA pilots transitioning to LSAs who underestimated the differences from their old airplanes and the new LSAs. “Most of those losses were early in the ownership experience,” he said.

Avemco changed its underwriting requirements to make up for those losses. Meanwhile, the industry matured, which meant more parts and maintenance shops were available to fix airplanes, while training also improved. All those factors led to the new rates, he said.